Oracle Blog

Thought Leadership on Social Technology and Social Marketing

Friday Aug 31, 2012

Social marketers who like to focus on the paid aspect of the paid/earned hybrid Facebook represents may want to keep themselves aware of how the network’s new Sponsored Results ad product is performing.

The ads, which appear when a user conducts a search from the Facebook search bar, have only been around a week or so. But the first statistics coming out of them are not bad.

Marketer Nanigans says click-through rates on the Sponsored Results have been nearly 23 times better than regular Facebook ads. Some click-through rates have even gone over 3%. Just to give you some perspective, a TechCrunch article points out that’s the same kind of click-through rates that were being enjoyed during the go-go dot com boom of the 90’s. The average across the Internet in its entirety is now somewhere around .3% on a good day, so a 3% number should be enough to raise an eyebrow. Plus the cost-per-click price is turning up 78% lower than regular Facebook ads, so that should raise the other eyebrow.

Marketers have gotten pretty used to being able to buy ads against certain keywords. Most any digital property worth its salt that sells ads offers this, and so does Facebook with its Sponsored Results product. But the unique prize Facebook brings to the table is the ability to also buy based on demographic and interest information gleaned from Facebook user profiles. With almost 950 million logging in, this is exactly the kind of leveraging of those users conventional wisdom says is necessary for Facebook to deliver on its amazing potential.

So how does the Facebook user fit into this? Notorious for finding out exactly where sponsored marketing messages are appearing and training their eyeballs to avoid those areas, will the Facebook user reject these Sponsored Results?

Well, Facebook may have found an area in addition to the News Feed where paid elements can’t be avoided and will be tolerated. If users want to read their News Feed, and they do, they’re going to see sponsored posts. Likewise, if they want to search for friends or Pages, and they do, they’re going to see Sponsored Results. The paid results are clearly marked as such. As long as their organic search results are not tainted or compromised, they will continue using search.

But something more is going on. The early click-through rate numbers say not only do users not mind seeing these Sponsored Results, they’re finding them relevant enough to click on. And once they click, they seem to be liking what they find, with a reported 14% higher install rate than Marketplace Ads.

It’s early, and obviously the jury is still out. But this is a new social paid marketing opportunity that’s well worth keeping an eye on, and that may wind up hitting the trifecta of being effective for the platform, the consumer, and the marketer.